Fed moves no effect on PH markets – BSP

The Bangko Sental ng Pilipinas (BSP) on Thursday said that policy movements made by the United States Federal Reserves is not expected to affect the country’s domestic financial markets.

“Although most market analysts view the Fed to have become slightly more dovish yesterday, its reaffirmation of its accommodative policy and reiteration of data dependency of its more specific actions in the interim are not expected to significantly impact domestic markets in the immediate term,” BSP Governor Amando Tetangco Jr. said in a text message to reporters.

In its post-meeting statement on Wednesday, the Fed said that the US economy continues to recover but is still in need of support, adding that it would keep buying $85 billion in mortgage and treasury securities to strengthen the economy.

Analysts said that the Fed statement had no indication that it is planning to reduce its bond-buying stimulus at its next meeting.

On the other hand, Tetangco said that financial markets in the Philippines are more likely to be affected of what is happening in the local scene.

“Our domestic financial markets will likely take more cues from domestic economic news,” he said.

Tetangco also assured the public that the central bank will consider the Fed moves in its policy making.

“Nevertheless, over the medium, BSP will take into account the Fed moves and forward guidance on interest rates and assets purchases to see how these affect investor sentiment and flows, and make adjustments to our own stance as appropriate for achieving our price and financial stability mandate,” he said.